Follow the Finns: Embrace risk, failure and ‘Sisu’ mindset - Nick Murray

Originally published in the Scotsman, 3 December 2022

Working in Scotland’s entrepreneurial ecosystem, it’s very easy to be consumed by your echo chamber, and the possibilities, and indeed, limitations of the people and infrastructure that surrounds you.

In the same way that holiday travel expands our personal horizons and mindsets, so too is it imperative to explore new frontiers and business frameworks in overseas ecosystems. This was the intention of a recent programme delivered by myself, Caro Melendez, and Dec McLaughlin of Startup Grind Scotland, in partnership with the Scottish Government and Scottish Development International, to take 10 of our country’s most promising tech startups and cross-agency ecosystem builders to experience the vibrant city of Helsinki, and its world-famous Slush conference.

Why Finland?

With an ecosystem valued at €37Bn, boasting 1822 startups, 500+ investors, 72 support platforms, and the yearly Slush conference attracting 12,000–25,000 people, Helsinki marries entrepreneurial excellence with enviable societal equality and quality of life. Here, startups are not just a sector. They’re truly part of the society. The country is home to 8 unicorns who all openly and happily pay up to 49.2% tax, viewing it as a civic badge of honour to contribute to the high-functioning social infrastructure.

This is what we learned and what I think Scotland could adopt from the Finns.

Embrace risk, failure and the ‘Sisu’ mindset

In many ways, the Helsinki ecosystem was built on failure. When Nokia crashed in 2008 it released hundreds of talented developers into the job market. Many started their own businesses, and many of those businesses failed. They started again, and with the combined support of the universities, its student body, and some light state intervention, the scene began to bubble.

The Slush conference itself was, and still is, run by students, with a frequent renewal of the team to ensure things don’t get stale. The conference now attracts thousands of people from across the globe, including international investors looking to find the next big thing. This success didn’t just happen. In the early days, the event organisers chartered a plane full of Silicon Valley VCs to showcase their offering. That gamble paid off. Investments in Finnish startups reached over €1Bn in 2021 alone.

The Finns call this spirit of perseverance ‘Sisu’, a kind of stoic determination and resilience to push through the hard times like chipping through a block of ice. This national characteristic lines up well with entrepreneurial tenacity, a level of mental toughness that can only be built through embracing risk, hardship and failure, and coming through the other side bigger and better.

In contrast, I feel like in the Scottish ecosystem, we celebrate success too early, and celebrate the wrong things. Small raises, grant awards and new hires don’t make businesses successful. I often worry that this parochial approach does nothing to calcify Founders against the setbacks they are bound to encounter, instead creating a false success narrative that coddles our businesses and discourages risk.

The spirit of collaboration

What was striking from all of our interactions in Helsinki was the lack of ego or siloed thinking. The universities, incubators, accelerators and public sector support bodies work hand-in-glove to streamline support activity, rather than duplicate effort or compete for the same audience.

Maria01, a massive enterprise hub based in an old hospital, houses startups, advisors, accelerators, incubators and investors all mingled under one roof. The Finnish public sector bodies see themselves as part of this community rather than part of the state. Their role is to create the conditions for things to happen, rather than picking winners or making things hard to access.

This is night and day to Scotland, where our ecosystem is distributed and competitive, somewhat dominated by a sense of tribalism of brands and geography, with a siloed and inconsistent approach to enterprise support across regions (eg. the disconnected Business Gateway network or the game of Scottish Enterprise Account Management), where similar and competing services and events confuse the entrance point or support roadmap for Founders.

The opportunity for Scotland

The message from Finland is clear; If you’re fighting for control, clout or your piece of the pie, you’re not fighting for the big picture. If Scotland’s entrepreneurial ecosystem is to continue to grow and attract international attention and investment, we need to disregard old-fashioned and tribal thinking, and adopt a ‘Team Scotland’ approach to act as a national flare gun, illuminating what we have to a global audience.

Encouraging new players, including students, to enter and contribute to the ecosystem, run events, and showcase ‘their’ Scotland, will lead to fresh ideas and could help to retain university and graduate talent.

It was vital to have representatives from the Scottish Government with us on this trip, to learn from this vibrant ecosystem, but also to have extended face time with our startup cohort to better understand their pain points and frustrations with local enterprise support.

Admittedly, there are signs of a refreshing approach to state support here in Scotland. The energy and effort put behind making the recommendations of the Logan Report a reality by the Scottish Government, with pockets of funding opening up to empower grassroots projects through the Tech Ecosystem Fund earlier this year, the appointment of Mark Logan as Scottish Government’s Chief Entrepreneur, and the awarding of the Techscaler network contract to community-builders CodeBase, all mark a shift from previously prescriptive policy towards a vote of confidence in those on the ground who can deliver impactful work with a light touch from the state.

As the saying goes, “If you want to go fast, go alone, if you want to go far, go together”. I believe that, together, we can move Scotland closer to the Finnish line.